Toronto reveals how private trash haulers are doing

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Private trash haulers in Toronto were supposed to save ratepayers millions of dollars, but a new report finds they missed the target by more than $23m in 2013-14.

The report released Monday by city documents doesn’t lay blame. Asking for a cut from the cost of providing garbage and recycling collection services had been put on the 2014 budget, which they did not adopt, and there was a $12m deficit in the contracts.

The city hired Wastebasket to audit billing records for the private collection agencies that the city contracts with.

The success of the bid to privatize the garbage collection service, at the same time as talks about the next general operating agreement began, represents the first significant challenge for Toronto mayor John Tory’s administration.

An audit report from March 2015 blamed contractor errors for the lack of savings. In 2016, the city’s general manager said the city was unable to predict how private collection would affect costs, so low margins for collectors were “a natural outcome”.

The city in 2006 purchased a two-year concession to the collection of 2,500 bins filled with recyclables. Over the next 15 years, the city has awarded 15 private agencies at least two more contracts, for recycling and pick-up.

Tory has been an advocate of privatization for several years, with an eye to turning over responsibility for some services. The end of the contract for the collectors comes next year, and Tory wants to review the next option for waste and recycling services. He said the impact of private contractors will be examined again, which is ironic, because they are now investigating why they miss their targets.

“The private garbage contractors seem to be performing an essential service, but their performance is not consistent,” the city’s manager of the waste and transportation system said in the report.

“This is not an exhaustive or comprehensive examination of contractor performance, but it gives a rough idea of what the information is showing, and it’s information that should be captured in any project that we run.”

An expert in waste management told the Guardian the city is facing the difficult position of trying to keep costs under control while having to pay private collectors a margin that is, at times, larger than the revenue they generate.

Asked about future costs for trash collection, Tory said his team will review costs and practices by contractors.

“I’m interested in all parts of the waste and transportation portfolio, and we’ll see where that leads,” he said.

The waste utility and water services department did not respond to requests for comment on how they plan to save money.

Toronto has had some success in reducing the number of spaces for people to dump trash and recycling. This year it reduced the amount of trash residents could use, at a time when they wanted to reduce the number of trips for them to empty out their waste. Last year, the city started a 10-year plan to eliminate the winter curbside red zone and to convert the automated collection services to a network of free, curbside pick-up.

Both developments can be used to set up a single point of control for collection and scheduling, and even to push residents toward using the city’s green infrastructure to reduce their waste intake. In the face of budget constraints, the city also plans to automate collection, which will give a better overview on how it’s working.

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